The majority of global investors surveyed by Dynamo Software this summer — 56% — say they plan to increase their alternative investment allocation over the next 12 months, compared with 55% in the company’s 2022 survey, according to findings shared exclusively with Alternatives Watch.
Dynamo’s Frontline Insight Report, published in partnership with Northfield Information Services, surveyed more than 100 global LPs and asset allocators online in July and August 2023. Officials concluded that lack of change over the interest in further investment in alternatives from the previous year may be notable in and of itself.
Most (71%) continue to see the best opportunities in North America. Asia and Europe are of interest to a small subset of allocators (14% each), but no LPs reported plans to deploy capital in the Middle East market.
Of the LPs looking to put money to work in the coming year, 86% are planning to do so via fund managers, Dynamo found. Co-investments though remain popular with over 61% planning to invest in those deals, which is up from 54% last year. Secondaries too are attracting greater interest with 36% of LPs expecting to go that route as opposed to only 28% last year.
On the heels of the FTX scandal and most recently the upset of the SEC in the Grayscale Bitcoin Trust ETF court case, cryptocurrency interest fell sharply from over 13% of allocators interested in the sub asset class in 2022, to just over 3% this year. Dynamo said the findings make sense, as investors seem to be steering clear of more volatile investment strategies. Also, cryptocurrencies are not seen as a hedge against inflation, officials added.
Read the rest of the article at Alternatives Watch here.